Aquarius Fisheries director David Olsen said he didn't condone the actions of Mr Reece or Rob Mason, who shot the video, and the pair were dismissed earlier today.
Mr Reece, who confirmed he had been dismissed, said he realised the video was "pretty stupid" but he didn't regret killing the shark.
"I'm not too pleased with myself. I've had time to think about it now and I know posting the video didn't do myself or my industry any favours.
"But I don't feel bad for killing the shark. People who know nothing about fishing are saying I should have severed its backbone and let it bleed, but I don't see that as being very humane."
The whole shark - fins and trunk -- was sent to the fishery, Mr Reece said.
"I haven't committed a crime. The shark had a steel trace in his mouth which means it had been previously caught by an amateur fisherman.
"What is a crime is that amateur fishermen are able to catch them, put them on display for hours for competitions and then dump them back in the sea."
Stargazer skipper Hendon Pierce was in the boat's engine room at the time of the incident and had no knowledge of it taking place.
By law, they were required to keep sharks if they were caught but they would normally leave them on deck to die, he said.
He described both men as extremely hard workers but said it was in everybody's best interest for them to be dismissed.
Mr Watson said he was dumbfounded by the video.
"I don't understand why they've done it," he said. "I'd like to think it's not just to be antagonistic and poke fun at my conservation efforts.
"It's fine to kill a fish if there's a genuine need for it and commercial fishermen generally work appropriately, but like any industry, there's people who are going to be idiots about what they do."
Mr Watson said he found the video emotive and wasn't surprised it had had a big reaction.
"I know a lot of people have been shocked by it and conservation groups have been talking about animal welfare.
"The shark was killed relatively quickly but it's still a pretty smart-a**e thing to do."
Sea Shepherd Conservation Society national director Michael Lawry said it wasn't illegal to kill shortfin makos but it was "very disturbing" that a commercial fisherman would kill one so aggressively.
"It's really disrespectful that he would club marine life and then post it on the Facebook page of the most well-known recreational fisherman in the country," he said.
"They're a threatened species and Matt Watson has promoted shark rights ... the fisherman's attitude is very unsettling."
A Ministry for Primary Industries spokeswoman said the ministry was unaware of where or when the incident took place but it had seen the video and was looking at what it would do next.
The video has had more than 40,000 views on Mr Watson's page and another 40,000 views on ITM Fishing Show's page.
